“The Galleon insider trading case is one of four Wall Street’s major cases which contains the intimate information distribution of extremely honoured global firms such as Goldman Sachs and Procter & Gamble” ( Raghavan, 2013:235). According to Law (2016:315), insider trading is the dealing in company securities with a view making a profit or avoiding a loss while in possession of price-sensitive information that is not generally known. This led to Rajat Gupta and Raj Rajaratnam to their fall, as one faces one count of conspiracy and five counts of securities fraud. This research paper will define the issues of Corporate Governance in the Galleon insider trading case. The Governance Institute of Australia defines corporate governance as governance encompasses the system by which an organisation is controlled and operates, and the mechanisms by which it, and its people, are held to account. Ethics, risk management compliance and administration are all elements of governance.
Directorships and Chairmanship on various
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“There is a global debate on whether appointing directors who already hold directorships in other companies is a good or bad corporate governance practice” (Ferris et al., 2003: 1087–1111). “Such individuals are known as "dual" or "multiple" officers or directors, depending on the number of corporate boards upon which they serve” (Skinner, 1984:77). Rajat Gupta is a board of director on 7 different companies. Rajat duties of a director and his own common interest will be in conflict. He uses his advantage of being on many or various boards of directors by leaking important information which he obtained at a boards meeting. The information he obtains is than used to make money for his own company through his partner of the business by the buying and selling of